Do You Understand The Tax Related Matters Concerning Unit Fund-Raising?

Because of the company's business needs, it plans to raise funds to employees 5 million yuan, the number of participants has 50 people, the loan period is 1 years, the interest on loans is 10% annually, and the loan contract is signed, which directly allows employees to enter the basic household of the company. What are the interest rates of the company's interest in borrowing money from employees?

The notice issued by the State Administration of Taxation on the issue of business tax (1) > (No. 1995 of the national tax Letter No. 156) stipulates that loans refer to the business of lending funds to other people, including loans of their own funds and loans.

The notice issued by the State Administration of Taxation on the issuance of the answer to business tax (1) > (No. 1995 of the national tax Letter No. 156) stipulates that the annotations of the business tax items stipulate that loans belong to the scope of tax collection of the "financial insurance industry", while loans refer to the act of lending funds to others.

According to this regulation, no matter financial institutions or other units, as long as it occurs, the behavior of using funds to lend to others should be regarded as a loan action, and the business tax is levied according to the "finance and insurance industry" tax items.

According to the above provisions, individuals who borrow money for interest are classified as loans and should pay business tax.

However, the individual has a levy point, and the interest income does not reach the threshold, and is exempt from business tax.

The regulations on the implementation of the individual income tax law stipulate that interest, dividends and bonuses refer to the interest, dividends and dividends earned by individuals who own creditor's rights and shares.

Therefore, the interest earned by employees' loan funds should be paid by personal income tax with a tax rate of 20%.

The eighth provision of the "personal income tax law" stipulates that the individual income tax shall be the tax earner of the income, and the withholding agent shall be the unit or individual paying the income.

The Circular of the State Administration of Taxation on Issuing the Interim Measures for the withholding and repaying of personal income tax (No. 65 of the national tax [1995] 65) stipulates that any enterprise, company, institution, organ, mass organization, military recognition, resident institution or self-employed person who pays personal taxable income shall be the withholding agent of personal income tax.

The third provision stipulates that withholding personal income tax in accordance with tax laws and regulations is the legal obligation of withholding agents, and the heart must be fulfilled according to law.

The fourth rule is that withholding agents to pay the following income to individuals, they should withhold personal income tax: (six) income from interest, dividends and bonuses; therefore, your company should withhold the employee's personal income tax.

The sixty-ninth provision of the law on tax collection and administration stipulates that withholding agents should not deduct or receive tax receivables, the tax authorities shall recover the tax from taxpayers, and impose a fine of fifty percent times or less than three times the amount of the tax withheld by the withholding agents.

The Circular of the State Administration of Taxation on the implementation of certain specific issues concerning the law of the People's Republic of China on tax collection and management and its implementation rules (No. 47 of the National Tax Administration [2003]) stipulates that the withholding agent shall, in violation of the law of collection and administration and the detailed rules for its implementation, deduct the tax receivable and collect the tax receivable, unless the tax authorities impose sanctions on them in accordance with the relevant provisions of the collection and management law and the detailed rules for their implementation, the tax withholding agent shall be instructed to deduct or recharge the tax that is not deducted or receivable.

Therefore, if your company fails to withhold the personal interest tax on employee interest, the tax authorities may impose a fine of not less than fifty percent times the amount of tax receivable not received or collected by the company, and instruct your company to deduct or recharge the tax withheld or receivable within a specified time limit.

First of all, your company should pay legal interest to pay interest.

Secondly, interest expense beyond the prescribed standard can not be deducted before tax.

The twentieth provision of the invoice management regulation stipulates that all units and individuals engaged in production and business activities shall obtain invoices from the receiving party when purchasing goods, accepting services and paying for other business activities.

No change in name and amount may be required when obtaining the invoice.

Article nineteenth (1) of the detailed rules for the implementation of the Provisional Regulations on business tax stipulates that the amount paid to domestic units or individuals and the acts of the unit or individual are within the scope of business tax or value-added tax collection. The invoice issued by the unit or individual is a valid and valid certificate.

Therefore, you should pay the personal interest by invoice.

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If your company fails to obtain the invoice, it shall not be deducted from the tax before the tax is issued according to the circular issued by the State Administration of Taxation on the further strengthening of the specific measures for tax collection and Administration (No. 114 of the National Tax Administration [2009]).

The interest expense can not be deducted before tax.

Refer to the management method (discussion draft) of pre tax deduction of enterprise income tax, the interest paid by an enterprise to a non-financial institution or individual shall be used as a pre tax deduction certificate with the loan contract (or agreement), payment documents, invoices or related notes.

If it is not possible to obtain the invoice, the loan contract (or agreement), the payment document and the receipt of the personal evidence can be provided. In practice, it can be used as a pre tax deduction certificate, but there is a certain risk.

The Circular of the State Administration of Taxation on the interest payment of enterprises' loans to natural persons before tax deduction (state tax Letter No. 2009] No. 777) stipulates that the interest expenses paid by enterprises to natural persons who have connections with shareholders or other enterprises shall be calculated on the basis of the forty-sixth provisions of the enterprise income tax law of the People's Republic of China (hereinafter referred to as the tax law) and the conditions of the Ministry of Finance and the State Administration of Taxation on the issue of tax policies concerning the pre tax deduction standard for the interest expenses of enterprise related parties (fiscal 2008 [121]), and the deduction of enterprise income tax shall be calculated.

The second provision stipulates that the interest payments of an enterprise to an employee or other person other than the provisions of Article 1 shall be consistent with the following conditions, and the interest expense shall not exceed the amount calculated according to the same loan interest rate of the same period of the financial enterprise, and shall be deducted according to the eighth provisions of the tax law and the twenty-seventh regulations of the tax law.

(1) the loan between enterprises and individuals is real, lawful and effective, and does not have the purpose of illegal fund-raising or other violations of laws and regulations; (two) a loan contract has been signed between enterprises and individuals.

The state

The General Administration's bulletin on a number of issues on enterprise income tax (thirty-fourth) of the State Administration of Taxation (State Administration of Taxation, 2011) on the determination of the interest rate of similar loans in financial enterprises for the same period, according to the thirty-eighth article of the regulations on implementation, the interest expenditure of non financial enterprises to non financial enterprises is not more than the amount of the amount calculated according to the same kind of loan interest rate in the same period of the financial enterprises.

In view of the specific circumstances of China's current interest rate requirements for financial enterprises, enterprises should first provide interest and pre tax deductions in accordance with the requirements of the contract, and provide a "statement of interest rates for similar loans of financial enterprises" in the same period, so as to prove the reasonableness of their interest expenses.

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"The description of interest rates for similar loans in the same period of financial enterprises" should be included in the signing of the loan contract, when any financial enterprise in the province provided the same loan interest rate in the same period.

The financial enterprise shall be a financial institution that can be engaged in loan business established by the relevant government departments, including banks, financial companies, trust companies and other financial institutions.

The term "similar loan interest rate" refers to the interest rate provided by financial enterprises in terms of loan period, loan amount, loan guarantee and enterprise reputation.

It can be the same kind of average interest rate announced by financial enterprises in the same period.

The actual loan interest rate provided to some enterprises.

Assuming that the same loan interest rate of a financial company is 6%, your company pays interest on 10% to employees (non shareholders and related parties), and you get the valid and valid certificate of interest payment, and the interest of more than 6% parts can not be deducted before tax.

If you fail to obtain legally valid certificates, interest expenses can not be deducted before tax.

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